The shake-out in Korea: How small firms survive

This study explores the patterns of strategic change of five small firms in the Korean tile industry. The historical analyses both at the industry and at the individual firm revels revealed that: 1)the tile industry was comprised of several product/market segments which have different attractiveness and key success factors, 2) changes in labor market, technology and market demands imposed differential impacts on different product/market segments, 3) the degree and direction of strategic change of an individual firm were constrained by the prior product/market domain in which it participated and the resources/capabilities it accumulated,and 4) high performing firms appeared to be those who positioned in more attractive segments and possessed resources/capabilities which are key success factors of those segments. Finally, on the basis of the result of this study, a process model of strategic change formulation is suggested. (C) 1998 Elsevier Science Ltd. All rights reserved.